LTC Properties(LTC)2025-02-25 20:00Financial Data and Key Metrics Changes - Net income available to common shareholders decreased by 10.1% due to a decrease in gain on sale, an increase in impairment losses, and higher general and administrative expenses [13] - FFO excluding non-recurring items improved by 2.1% primarily due to lower interest expense and rent increases from fair market rent resets [14] - On a fully diluted per share basis, FFO was 0.57 last year, while core FFO was 0.66 per share in Q4 2023 [15] Business Line Data and Key Metrics Changes - The company is targeting 200 million in initial gross investment assets to convert from triple net leases to RIDEA structures [11] - Year one NOI from these conversions is expected to offset initial expenses incurred to build the RIDEA platform [11] Market Data and Key Metrics Changes - Occupancy in the portfolio increased by 740 basis points from January of last year to January of this year [24] - The company expects to receive 3.7 million in 2024 [24] Company Strategy and Development Direction - The company is focused on diversifying its portfolio with respect to operator, geography, property type, and investment vehicle [10] - RIDEA is seen as a transformative strategy that will unlock long-term growth potential [12] - The company aims to complete the search for a new Chief Investment Officer by the second quarter to assist in growing the RIDEA platform [7] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, citing a strong growth strategy driven by RIDEA [5] - The company is in one of the best positions for accretive growth in recent years, having diversified its portfolio and shored up its balance sheet [27] Other Important Information - Total liquidity at the end of the last quarter was approximately 229 million at the end of September 2024 [17] - The company entered into a new 200 million program [15] Q&A Session Summary Question: Details about the operator not renewing - The operator decided to downsize and exit the states where the properties are located, with credit enhancements in place to secure rent payments [31] Question: Neutral earnings impact from transition to RIDEA - The transition accounts for expected one-time expenses related to setting up the platform, with an in-place yield of about 8% [38] Question: Percentage of portfolio expected to be RIDEA vs. net lease by end of 2025 - Currently about 50-50, but expected to increase more towards RIDEA over time [44] Question: G&A expectations for the shop operating platform - Increased G&A will be provided after establishing the platform, but expected increase in NOI from the shop portfolio to offset expenses this year [46] Question: Circumstances leading to restoring accrual accounting for master leases - Strong operational performance led to higher confidence in receiving contractual rent through maturity [98]